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Maraquand's legendary smoke shop/newsstand on the corners of Powell and O'Farrell is going out of business because it can't afford new rent increase. Owner Daniel Ortega, and 35 year employee Chris Christensen will close the doors for the last time at the end of Dec. By Lance Iversen/San Francisco Chronicle

Photo: Lance Iversen

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Maraquand's legendary smoke shop/newsstand on the...

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Maraquand's legendary smoke shop/newsstand on the corner of Powell and O'Farrell is going out of business because it can't afford a rent increase. Owner Daniel Ortega, and 35 year employee Chris Christensen will close the doors for the last time at the end of Dec. By Lance Iversen/San Francisco Chronicle

Photo: Lance Iversen

SMOKE11_057.jpg_
Maraquand's legendary smoke shop/newsstand on the...

Image 3 of 3

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Maraquand's legendary smoke shop/newsstand on the corner of Powell and O'Farrell is going out of business because it can't afford a rent increase from the landlord. Retired Carl Hofstetter from SF has been a steady customer for the past three years. Owner Daniel Ortega, and 35-year employee Chris Christensen will close the doors for the last time at the end of Dec. By Lance Iversen/San Francisco Chronicle

Marquard's Smoke Shop feels like a little slice of Sam Spade's San Francisco. Squint through the dusty windows under the vintage awning and you can almost picture the hard-boiled private eye sauntering in for a bottle of whiskey and a pack of smokes.

But by the end of the month, the newsstand on the corner of Powell and O'Farrell streets will go the way of many mom-and-pop shops, closing as commercial rents soar out of reach.

Owner Danny Ortega, 52, practically grew up in the store; his parents, August and Annie, bought the business 45 years ago from the original owner, Chuck Marquard.

Ortega took the streetcar downtown after school to do his homework behind the counter back when he could barely see over it. After graduating from San Francisco State University, he planned to become a history teacher, but his dad had a stroke, he stepped in to lend a hand with the family business -- and he's still there, some 30 years later.

"I feel part of San Francisco. It's really an emotional time for me," said Ortega, a short, tidy man with a friendly word for everyone who comes in.

With its prime location partway between Union Square's posh hotels and the cable car turnaround, Marquard's hosts a constant stream of humanity, San Francisco-style.

Chic Japanese tourists finger baseball caps; a rheumy-eyed man in a wheelchair dumps a cupful of change on the counter to buy a can of malt liquor. Later, he returns with more change in the cup, which is labeled "God Bless" in shaky handwriting, and exchanges it for a crisp $5 bill and a handful of Reese's Peanut Butter Cups.

A little old lady stocks up on magazines, clicking her tongue over the price of Vanity Fair, and tattooed and pierced youngsters show their IDs to buy cigarettes. One Russian customer seems to speak only one word of English: "Coca-Cola." A couple with French accents asks for a phone card; several men in their 50s hunched into leather bomber jackets get the Daily Racing Form; one proudly displays the ticket that he says may win him $5,000 at Golden Gate Fields tomorrow.

Some 1,500 people a day cross the threshold, Ortega said, spending an average of $4 or $5 each -- but that adds up to over $2 million a year. Marquard's is open 7 a.m. to 10 p.m. every day of the year except Thanksgiving and Christmas.

The store's 300 square feet are crammed with a hodgepodge of products. Alcohol and soda, cigarettes and cigars, and magazines and newspapers take up the bulk of the space, but everywhere you look are sundries: aspirin, toothbrushes and razors; chips, cookies and candy; San Francisco tchotchkes; boxes of bananas, apples and oranges. The most expensive item, Courvoisier cognac, ordinarily $52, is now marked down to $39.95.

These days, gaps loom on the shelves like missing teeth as Ortega lets the inventory dwindle.

He's fine with people browsing the racks of magazines outside without buying, although a regular number avail themselves of a five-finger discount.

From his vantage point, Ortega has seen the ebb and flow of the city's life and times.

Powell Street used to be populated with senior citizens living in residential hotels; as a kid, he knew many of the residents by name. The shops in the area used to be local concerns, he says, rolling the names off his tongue: Bernstein's Fish Grotto with its wooden mermaid out front, Tro Harper's bookstore, City of Paris department store, I Magnin's and Joseph Magnin, Scandinavian Pastries. Now, of course, it's a tourist mecca and most of the stores are chains.

He remembers mounted police chasing protesters down Powell Street in the 1960s; dissidents marching during the Iranian hostage crisis; rioters after the Rodney King verdict.

The day after the 1989 Loma Prieta earthquake, the police asked Ortega to stay open, he said.

"We operated with a handheld calculator and had lines out the door. People wanted batteries or basic food items. Visitors couldn't use their ATM cards because the electricity was out. People said 'I'll write you a check from Oklahoma' and we cashed them because people were in need."

Foreign newspapers -- usually a day or two behind -- used to be a big item, but the combination of decreased international travel since Sept. 11, 2001, and instant Internet access to news, has cut into that business.

Ortega grew up in San Francisco's Lakeshore area and now lives in the suburbs. None of his three kids, ages 22, 20 and 18, worked in the store, but they all hung out there. "They saw things they didn't see in Petaluma," he said.

Most of Marquard's 10 employees are college students, but manager Chris Christensen has been there since he was a teen. His dad worked for Ortega's dad. "We grew up like brothers," Ortega said.

He's still in touch with many of his employees from over the years and hopes to have a big farewell party in January. And it might even be a resurrection celebration; he's trying to find another downtown space where he can reopen.

Before it was a smoke shop, the store was a haberdashery, Ortega has heard. Coincidentally, it will become one again, but with a contemporary twist. The new tenant taking over both Marquard's and the jewelry shop next store is Hat World, a huge national chain specializing in logo caps. Ortega said the rent for the two spaces will be about $40,000 a month; he pays a touch under $15,000 a month.

He's not sure just how old the store actually is, but longtime customers have told him it pre-dates World War II. The building is even older; he thinks it was erected shortly after the 1906 earthquake and fire. Upstairs, there is a rabbit warren of rooms that used to be a brothel; downstairs are bricked- over tunnels that lead to a former gambling den.

Like its long-ago roots, the store has its unsavory elements. The booze tends toward the potent and cheap, the girly magazines include some raunchy specimens and the tobacco products are high potency.

"A lot of places are sleek and polished and shined," Ortega said. "But we provide a service; we're a fixture for downtown."